When you set up business with a partner you have a plan in place of what you would like to achieve, these targets maybe monthly, annually and then long term to retirement along the planning. During the set up you may have decided to be key members of staff yourself and therefore having a controlling interest in the business and producing a large contribution to the profit you are vital to the success of the business.
No matter the size your business has now grown to or the amount of the employees you now have, your visions and purposes will remain the same to achieve your end goals. Along your journey of growth and achievement have you thought about what may happen if you were unable to work due to a critical illness, what would happen to the business, the employees, and your business partner?
Would your business survive?
This is where we come in, as professional Business Protection Consultants we look at the key areas to your business from the Owners, to the Key People and ensure that if Critical Illness or Death were to happen your Business would not suffer a financial loss and would be able to continue trading.
Shareholder Protection ensures that if a shareholder, Director or Partner were to die, the business would have enough money to buy the shares back from the next of kin under a pre written agreement with a specific amount for the shares. Thus meaning the business would not have to take loans or draw monies from the business to buy out the next of kin or risk them selling to a competitor.
Key person Insurance allows the business to continue trading without a loss of income, as the policy pays out this ‘Key persons’ contribution to the business over a year, allowing the business to recruit and train a replacement member of staff and bring them up to the production levels of the member that has been lost with as little financial impact as possible.
Business Loan Protection will cover any loans or finance the business has taken out over time, such as a Mortgage on the property you trade from or a Loan you have taken to buy machinery or stock. The cover will pay out upon Death or Critical illness (if you chose) and will reduce the outgoing costs to the business after the event. Ensuring they can continue to trade without added pressure of covering these expenses.
Relevant Life can be given to any Employee of the business as a Death in Service payment, this is a benefit you can offer to your staff or take for yourselves as a director. This is a payout to the family or deceased’s estate so not directly benefiting the business but allowing you to provide a payment that benefits the family of the deceased.
We can also look at further benefits you can provide to your staff, with options of Group death in service, private medical insurance and pension services. As an employer these benefits can aid your Employee benefits package offered.
Tell me about the risks
Death of a Shareholder?
With Shareholder Protection in place, the remaining Shareholder(s) can purchase back the Deceased shares from the next of kin that inherited them. Reducing the risk of having an uninterested shareholder or them selling the shares to a competitor.
By having Shareholder protection, the lump sum pays out on the agreed value of shares and allows the business to buy them back without taking the funds out of the business to do so. This in turn allows your business to continue trading.
Loss of a Key Person through Death or Critical Illness?
Key Person plans also known as Key Man insurance gives the business a lump sum of money to replace the loss of income that would have been produced by this member of staff, whether it be a director or the head of Admin, this member of staff would have been identified as a Key Person in the business. Without them the business will suffer a financial loss or reduction.
We can cover that loss or reduction and aid the hiring of a replacement covering recruitment and training costs. This will allow the business to continue trading with minimal impact to the figures.
With other policies available to give benefits back to staff or yourself as the business owner, we would urge you to contact us for a full review of your business and its people and allow us the opportunity to give you the answers to the “What ifs” and explain how your business could survive them.
